The document discusses the challenges and opportunities presented by digital transformation. It outlines the OECD's Going Digital project, which aims to 1) improve understanding of digital transformation's impacts, 2) provide policy tools to help economies prosper digitally, and 3) address the gap between technology and policy development. Key points include the need for comprehensive and proactive policy response to harness new opportunities while managing disruption, and ensuring no one is left behind as new skills are required.

1. Going Digital – Making the Transformation
Work for Growth and Wellbeing
31st Digital Economy and
Telecommunications Summit
Santander, 4 September 2017
Dirk Pilat
Directorate for Science, Technology and Innovation
dirk.pilat@oecd.org

2. Outline
1. The Context
2. The Going Digital project
3. Understanding the Digital Transformation
4. Next Steps

3. 1. CONTEXT

4. A wide range of new digital technologies
have emerged …
4
Cloud computing
Blockchain
Artificial
intelligence 3D printing
Big data
Internet of Things

5. 5
…., that are affecting all parts of the
economy
HealthPublic Admin. Retail
TransportationAgriculture
Science & Education
Manufacturing

6. Multi-factor productivity growth
Total economy, percentage change at annual rate
Note: Data for Ireland, Spain and Portugal correspond to the periods 1995-2014 and 2009-2014.
Source: OECD Productivity Database, April 2017. Statlink: http://dx.doi.org/10.1787/888933477326
The potential productivity benefits of these
new technologies are urgently needed ...
-1
0
1
2
3
4
ITA ESP PRT BEL DNK NZL CHE NLD CAN JPN FRA AUT AUS DEU GBR SWE USA FIN IRL KOR
1995-2015 2001-2007 2009-2015

7. … although today, many firms find it difficult
to turn new technology into productivity growth
The productivity gap between the globally most productive firms and other firms has widened
Note: “Frontier firms” is the average labour productivity (value added per worker) of the 100 or 5% globally most productive firms in each
two-digit industry. “Non-frontier firms” is the average of all firms, except the 5% globally most productive firms.
Source: OECD preliminary results based on Andrews, D., C. Criscuolo and P. Gal (2016), “Mind the Gap: Productivity Divergence
between the Global Frontier and Laggard Firms”, OECD Productivity Working Papers, forthcoming; Orbis database of Bureau van Dijk.

8. OECD Mobile broadband subscriptions per 100 inhabitants, by
technology, December 2016
Source: OECD, Broadband Portal, www.oecd.org/sti/broadband/oecdbroadbandportal.htm
Spain has made good progress on broadband
access, especially mobile …
0
20
40
60
80
100
120
140
160
1.2.2. OECD Mobile broadband subscriptions per 100 inhabitants, by technology, December 2016
Data and voice subscriptions
Data-only subscriptions
Total (where breakdown not available)

9. Source: OECD, Broadband Portal, www.oecd.org/sti/broadband/oecdbroadbandportal.htm, July 2017
… and is among the top of the OECD on fibre
connections, …
0%
10%
20%
30%
40%
50%
60%
70%
80%
Percentage of fibre connections in total broadband subscriptions, December 2016

10. The growth of fibre connections, December 2015- 2016
Source: OECD, Broadband Portal, www.oecd.org/sti/broadband/oecdbroadbandportal.htm, July 2017
.. and among the top in the OECD in the
growth of fibre connections
0
20
40
60
80
100
120
140
Annual Growth of fibre subscriptions among countries reporting fibre subscriptions, December 2015-2016%

11. The diffusion of selected ICT tools and activities in enterprises, 2015
Percentage of enterprises with ten or more persons employed
11Source: OECD, ICT Database; Eurostat, Information Society Statistics Database and national sources, April 2016.
But the intensity of ICT use in Spanish
business still lags in many areas …

12. Enterprises using cloud computing services, by size, 2016
As a percentage of enterprises in each employment size class
Source: OECD, ICT Database; Eurostat, Information Society Statistics Database and national sources, January 2017.
… with small firms lagging, even in
technologies well suited to them

13. Many jobs in Spain will be affected by the
digital transformation …
Jobs with high and medium potential for automation
Percentage of jobs with 70 % and between 50 % et 70 % of substitutable tasks
Source: Survey of Adult Skills (PIAAC); Arntz et al (2016)
0
5
10
15
20
25
30
35
40
45
50
SVK
CZE
ITA
DEU
AUT
POL
NLD
ENG/NIR
Average
USA
ESP
NOR
DNK
CAN
IRL
SWE
FRA
JPN
BEL(Fl)
FIN
EST
KOR
Significant change in tasks Automatable
13

14. 0
50.000
100.000
150.000
200.000
250.000
300.000
350.000
400.000
450.000
Typesetter and compositor jobs
Graphic design jobs
… but history suggests new jobs will also
emerge, complementary to new technology
Source: Presentation by Professor James Bessen at OECD workshop, 24 April.

15. Individuals who judge their computer skills to be sufficient if they were to apply for a
new job within a year, 2013 (as a percentage of all individuals)
0
10
20
30
40
50
60
70
80
90
%
All Individuals Individuals with high formal education Individuals with no or low formal education
Source: OECD Measuring the Digital Economy: A New Perspective, 2014, http://dx.doi.org/10.1787/888933148354.
New skills will be needed, …

16. … which may not be easy for many workers
Source: OECD calculations based on the Survey of Adult Skills (PIAAC) (2012 and 2015), www.oecd.org/skills/piaac/publicdataandanalysis .
The proportion of low performers in literacy and/or numeracy, workers
Few high-skilled
workers
Many workers
lacking ICT skills
16
0
10
20
30
40
50
60
70
% Inbothliteracyandnumeracy Inliteracyonly Innumeracyonly

17. Individuals using the Internet for sending filled forms via public authorities
websites in the past 12 months, by education level, 2015
Source: OECD, ICT Database; Eurostat, Information Society Statistics Database and ITU, World Telecommunication/ICT
indicators Database, July 2015; Government at a Glance (2017 forthcoming).
Government itself will also need to be
transformed

18. 2. THE OECD’S GOING
DIGITAL PROJECT

19. Digitalisation has been on the OECD’s agenda for some
time – e.g. Ministerial Conference in Cancun, June 2016 …

20. … and is now also firmly on the G20 agenda,
with support from the OECD
The OECD launched its Going
Digital project at the joint OECD-
G20 conference on Key Issues for
Digital Transformation in the G20,
on 12 January in Berlin.
A background report was prepared
by the OECD. It laid the path for the
first ever G20 Digital Ministers
meeting, that took place in
Dusseldorf on 6-7 April.

21. But we need a more strategic and pro-
active approach to digitalisation
• Critical thresholds have been crossed
• Shift from an economic focus to socio-economic; all
sectors of the economy are affected
• Huge potential
• But realisation that digitally induced change will be
disruptive for many workers, firms and sectors.
• In many countries, a gap between Technology 4.0, and
Policy 1.0

22. Background
• The 2016 OECD Ministerial Council Meeting encouraged the
development of a horizontal policy strategy on digitalisation.
• The Going Digital project involves 14 core OECD
Committees, i.e. the Digital Economy Policy Committee
(lead), the Competition Committee, the Committee on Consumer
Policy, the Committee on Industry, Innovation and
Entrepreneurship, the Insurance and Private Pensions Committee,
the Committee on Financial Markets, the Committee on Fiscal
Affairs, the Committee on Scientific and Technological Policy, the
Committee on Statistics and Statistics Policy, the Economic Policy
Committee, the Education Policy Committee, the Employment,
Labour and Social Affairs Committee, the Public Governance
Committee, and the Trade Committee.
22

23. 1. Improve our understanding of the digital
transformation and its impacts on economy and society
2. Provide policymakers with the tools needed to develop
a pro-active, whole-of-government policy response to
help their economies prosper in an increasingly digital
and data-driven world.
3. Help overcome the large gap between technology
and policy development, Technology 4.0 – Policy 1.0.
Objectives

24. Three Areas of Work: 1. Development of
an Integrated Policy Framework
Building the Foundations for the Digital Transformation
Making the Digital Transformation Work for the Economy & Society
Effective
Use
(Firms)
Policy Coherence and
Strategy Development
Digital
Government
(Governments)
Trust &
Acceptance
(Firms, People)
Labour
Market
Adaptation
(People)
Framework Conditions (including Market
Openness)
Accessible Digital Infrastructures and
Services
Innovation
& Effects
(Sectors)
Well-being
(People)

25. • Enrich understanding of the digital transformation in specific
policy areas, e.g. financial markets, insurance, taxation, etc.
2: In-depth work on the digital
transformation in specific areas

26. 3: Cross-cutting work on some of the
big policy questions
1. Jobs & Skills:
• Characterise skills needs and
demands;
• Assess the implication of
automation for jobs and skills;
• Identify and (re)think policies
addressing challenges of Going
Digital for jobs and skills.
2. Productivity, competition &
market openness:
• implications for firms, business
dynamics and productivity
• implications for competition,
financing, market openness &
taxation
• role of framework policies,
especially for adoption
3. Well-being:
Impacts on
• Material conditions, e.g. job
displacement; scalable jobs;
choice, consumer surplus, etc.
• Quality of life: health; skills;
work-life balance; social
connections; environment ; civic
engagement; etc.
4. Measurement:
• Review current indicators and
frameworks, identify gaps,
explore digital sources; develop
a measurement roadmap.
• Scope: Data value and
international flows; Skills in the
digital era; Trust in online
environments.

27. 3. ENHANCING OUR
UNDERSTANDING OF THE
DIGITAL TRANSFORMATION

28. Digitalisation also changes the functioning of
the economy, challenging policy …
Policy has difficulty in adjusting to a digital era,
for example:
• The high speed of change
• The changing nature of capital
• The growing mobility of value creation
• The empowerment of individuals, crowds, SMEs and
regions
• And others ….

29. The high speed of digital
transformation, …
Graph showing the
time it took
different
technologies to
reacch X amount of
users
Challenges legacy policies and slow policy making -
speed may promote policy “arbitrage“ strategies
0 5 10 15 20 25 30 35 40 45 50
Smartphones
Internet
Mobile phone
Personal computer
Television
Radio
Telephone
Electricity
Source: US Census, Wall Street Journal
Years until used by 25% of US population

30. … the changing nature of capital, …
Intangible
assets
Servicificat
ion
Challenges policies directed at capital, e.g. tax incentives or
accounting rules, trade policy (goods vs services)

31. … the growing mobility of value
creation, …
Challenges policies that rely on geographical location,
e.g. education, corporate and labour tax, trade rules of
origin

32. … or the empowerment of
individuals, crowds, SMEs and regions
Enables entrepreneurship and engagement with crowds,
challenges policies that rely on a central point of control
(e.g. media)

33. 4. CONCLUSIONS

34. • The World (and Spain) is facing a massive economic
and social transformation, driven by a wide range of
new technologies and business models
• This offers many new opportunities for stronger
productivity growth, new jobs, and new solutions to help
address global and social challenges.
• But these potential benefits are not automatic and will
require a comprehensive and pro-active policy response;
leadership and vision will be key.
• There is a growing gap between technology (4.0) and
policy (1.5) - policy will need to move to a digital era –
better understanding the changes will help.
• There is much scope for learning across countries.
Key points

35. 1. Ensure the rolling out fibre networks to every citizen and firm
2. Foster the scaling of new digital business models and start-up
firms; and ensure sound competition
3. Facilitate the diffusion of technology and knowledge across the
economy, notably to SMEs
4. Adapt regulatory frameworks to the digital age
5. Facilitate digital trade
6. Support skills development to ensure nobody is left behind
7. Foster digital innovation by investing in the future
8. Protect privacy, security and consumers rights
9. Leverage digital technologies within government
10. Support workers displaced by the digital transformation
Ten policies to benefit from the digital
transformation

36. Thank you
36
Contact: dirk.pilat@oecd.org
Twitter: @OECDinnovation
and @PilatSTI
Going Digital website:
http://oe.cd/goingdigital